Oil's energy contribution has declined by about 12% since 1999. The world's economies have also declined by about 12%. (Using conventional metrics, which are time delayed determinations, this will only be seen in hind sight). The massive destruction of asset values now occurring testifies to it happening.
Peak is well behind us, world economies have peaked and will continue to decline.
Joined: Apr 16, 2008 Posts: 121 Location: Western PA, USA
Posted: Wed Oct 01, 2008 9:31 am Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
According to the inventory report AP, it looks like a couple of tankers unloaded a bunch of crude oil. These tankers were prevented from doing so due to port closures and with refinery's down all along the GOM, however some refineries have started to resume some production. This allowed all the tankers to rush as much of their built up product to our inventory as possible.
Joined: Apr 05, 2005 Posts: 2618 Location: South of Atlanta
Posted: Wed Oct 01, 2008 9:48 am Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
Ok, Ok, I get it, it just does'nt make sense at first blush. Its going to be very interesting to see how this all shakes out in just a few months. We have two very big issues which will bear watching.
1. What does the Crude production come back to and how fast? Does GOM production stay down forever due to the credit issues?
2. How long does the gasoline prioritization continue? With refining rates where they are the NE may be in for a very long and hard winter.
One more thing in just "thinking out loud", How does the credit situation impact refinery rates? if key infrastructure cannot be maintained/improved due to this is increased decline going to be the order of the day?
I've got a sneaking suspicion decline worldwide is going to take it in the shorts due to this fact.
Posted: Wed Oct 01, 2008 10:11 am Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
AirlinePilot wrote:
1. What does the Crude production come back to and how fast? Does GOM production stay down forever due to the credit issues?
Doubtful. Here's the long term view of US production. Katrina/Rita is pretty obvious, as is Gustav/Ike.
It looks like the 2005 storms may have sunk about 100kbpd beyond the long-term decline rate. Rates got most of the way back up by December.
Pup's guess that we'll not see 5mpbd is pretty close to the line. I think we probably will, but only barely. But, by the time offshore or ANWR boosts come online, though, we'll be *well* below 5.
I could be wrong, but I don't think the credit markets are impacting anyone in the oilfield. On the homefront, though, I am hearing of some people getting notices of lowered credit limits on their cards. That might put the fear of God in some. _________________ At 1% annual growth, human bodies will incorporate every gram in the observable universe in approximately 10,170 years.
Joined: Apr 06, 2006 Posts: 3626 Location: 3 miles NW of Champoeg, Republic of Cascadia
Posted: Wed Oct 01, 2008 1:28 pm Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
From what I understand credit issues can impact smaller producers, who can't depend on a massive revenue stream from sales or vertical integration they don't have to fund E&P. We've also seen that the majors don't necessarily consider E&P the most lucrative use for their money either.
On September 29, MMS reported that 52 of the 3,800 offshore oil and natural gas production
platforms have been destroyed. These platforms produced 13,300 barrels/day of oil and 90
MMcf/d. Additionally, MMS reported there were 32 platforms with extensive damage that may
take up to three to six months to repair and 41 platforms sustained moderated damage which may
take up to one to three months to repair.
They also say the status of 28 kb/d in LA is "unknown." Pipelines are up and running but only two of the Houston refineries is up to full capacity.
This double whammy of hurricanes was interesting, these operating level theories were put to the test, I hope someone examines the in toto situation in detail. We needed >10k Centerpoint employees to get the Houston grid back up, for instance; imagine the burden on logistics if there were shortages countrywide.
Would peak oil sneak up on us? Inexplicable year long drop in inventory, traders are frothing, price is nutty - would pols hear the call? Has anyone heard word one out of Congress about dealing with lackluster inventory in the future? Nope? I can't recall any great outcry for expanding MT this year either. _________________ Cogito, ergo non satis bibivi
C'mon man, who're you gonna believe?
Joined: Apr 16, 2008 Posts: 121 Location: Western PA, USA
Posted: Wed Oct 01, 2008 2:21 pm Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
[quote="pup55"]
Quote:
Also, note that the domestic US crude oil production dropped to under 4 mbpd. It had been running consistently about 5.1 mbpd for two years. perhaps we will never see 5 again, unless ANWR is opened up.
Could some of the U.S production declines be due to the lingering effects form Gustav and Ike, or could it just be the gradual decline in crude oil production that the U.S has been experiencing since the early 1970's?
Joined: Apr 05, 2005 Posts: 2618 Location: South of Atlanta
Posted: Wed Oct 01, 2008 6:37 pm Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
TheDude wrote:
Would peak oil sneak up on us? Inexplicable year long drop in inventory, traders are frothing, price is nutty - would pols hear the call?
Cognitive dissonance, denial, whatever you want to call it, every time we have something like this happen (Ike/Gustav) the problems will be a little more severe than last time, and last that much longer. Before you know it one of these "events" causes a collapse type scenario. It's a classic Boiling the Frog situation.
Your in the pot and the water is getting warmer right now.
Posted: Thu Oct 02, 2008 12:34 am Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
Crude oil stocks at Cushing was reported yesterday at 14.5 million. i was under the impression that there exists a operational minimum tank level of around 15-16 million. can anyone confirm this?
Average 19748.09402
max 28015
min 11677
stdev 3895.466647
sigma 2.071919682
so the current inventory level is a 2-sigma event.
The most recent occurrence of similar low inventory was the first two weeks of November 2007, when the inventory dropped to 13410. During this time period, the price went from 90 to 96 in about 15 days.
A previous occurrence was in the fall of 2004, this inventory stayed under 14.5K between August and November. During this time period, (first week of August through November) the crude oil price went from 46 to a high of 55 at about halloween time, then returned to the 48-level by thanksgiving.
The record low occurred earlier in 2004. 2004 was a period of chronically low inventory, it appears. The average from April through november was 14500. During the period between April and November, the price started at 34 and peaked out at 55.
The cushing-only inventory data only goes back as far as April of 2004.
Posted: Fri Oct 03, 2008 6:30 pm Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
the way the real US economy is going these days,
they will need very little gasoline inventory, just enough to
go to the Unemployment office for benefits and look for a job
a few times a month. Very little gasoline needed.
Peak oil delayed.
Those folks in the towns can burn garbage and studs from abandondened houses for heat and the other rural folks can burn firewood, like they have been doing for the past 100 yrs.
The big question this week is, even if the refinery system is put back together, which it is, from most reports, will the refiners actually run?
We all know that last week, refinery utilization recovered slightly, from the 66% that it was two weeks ago, increasing to 72%. We also know that it had been running about 5% below the 2007 level all summer long. Based on that, you could extrapolate and say that "normal" production ought to be something like 82%, but I do not believe that the production will get all the way back up to 82% until the refinery economics improve. Something midway is probably what is going to happen, maybe a little less than 80% is what I am guessing.
Based strictly on the averages, at 78% refinery utilization, we can expect to input about 13.5 mbpd of crude oil, but I do not think that it will actually be that high. Last week's crude oil inputs were a lot higher than they should have been based on 72% inputs, so I will estimate that this will be a correction week, where we input a lower amount than we should.
Based on 78% utilization, the unleaded production should be about 8, and the distillates about 4. I am keeping with that for the moment, but watch out for the possiblility that this figure will be higher than expected, as we continue to turn blending components into unleaded.
I also think the distillate consumption will pick up this week, because we are getting into the main harvest period in the upper midwest (the corn was still standing when I was up that way a couple of weeks ago).
We finally saw a little increase in unleaded imports last week. This is an area where we will be really interested to see what happens. At times in the past, we have received up to 1.6 mbpd of imports from Europe, delivered to the east coast.
For unleaded, the numbers add up to a drain of about 2 million barrels, but if there is an error it will be toward a smaller drain, or even a build in inventory if a flood of imports come in.
For distillates, the small drawdown above is pretty plausible.
For crude oil, a little build as the refiners are still slow, but the flow of imports should be plenty. I think we will see this inventory build for the next few months and it will be about 310 when we go into the heating season.
So, we will see what happens. The crisis situation inthe SEUS, which should have been a top story around the nation in the media, was drowned out by the credit crisis and Sarah Palin for some reason.
Joined: Sep 16, 2004 Posts: 4936 Location: Southwest WI
Posted: Mon Oct 06, 2008 7:27 am Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
Don't forget stove/chimney pipe and installation costs, unless you are comfortable cutting holes in your roof. _________________ Clothing should be optional.
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